MCX Diwali gift to investors as exchange to launch its first options contract in gold

By: | Updated: September 6, 2017 4:09 PM

Multi Commodity Exchange of India is about to launch its first options contract and that too beginning with the favourite precious metal -- gold.

The exchange has done all the preparations as gold is the best option for the company to begin within options, said MD & CEO Mrugank M Paranjape. (Image: Reuters)

Multi Commodity Exchange of India is about to launch its first options contract and that too beginning with the favourite precious metal — gold. The expected date of launch of MCX gold options contract is post-Dussehra and pre-Diwali, MD & CEO of MCX Mrugank M Paranjape said in separate interviews to ET Now and CNBC TV 18. Accordingly, Paranjape said that company is looking at the launch date somewhere between 5 October and 14 October.

“We had met almost every participant on the exchange and had probably covered probably covered more than 5000 jewellers in the last 2-3 months as we are ruling out this new instrument,” Paranjape added. The exchange has done all the preparations as gold is the best option for the company to begin within options, he added.

“In terms of the next contract we believe that after the first launch, between market regulator and all of us would like to watch for a couple of months which could be anywhere between 3 to 6 months as SEBI already has the norms for what should be allowed,” Paranjape said. Amongst the six to seven more contracts are there which will qualify for options contract and once SEBI is in position to allow more, the exchange will aim for the next four or five, he added.

He said that the options which currently qualifies are of silver, crude, natural gas, zinc, and some in the agricultural sector. The cotton and CPO (crude palm oil) contract both will qualify and have very-very deep participation and the exchange would definitely look at those as well when it comes to the next round, he added further.

When asked about the hour long trading disruption on MCX which happened on 4 September, he said that technical glitch has been taken care off. Earlier on 4 September trading on MCX, the country’s leading commodity exchange, was disrupted for about 60 minutes this evening, the company said. “The trading system witnessed a problem at around 6.36 pm,” the MCX said in a release. After assessing all the hardware, software and network aspects, it was decided to restart the trading system. Members were then allowed to re-login at 7:15 pm.

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